Cyber Risk Insurance A Way to Transfer Your Cyber Risk
10/06/16 16:27
Cyber Risk Insurance A Way to Transfer Your Cyber Risk
In a recent research report from the Information Security Forum “Threat Horizon 2018: Lost in a maze of uncertainty”, one of the top threats for organisations for 2018 is lack of availability of cyber risk insurance. The report predicts that large data breaches will drive many insurers out of the cyber insurance market and that will disrupt this method for organisations to transfer cyber risk. A reduced capacity in the insurance market will normally translate into difficulties in getting cover, high premiums as well as extensive policy exclusions.
This brings us right back to the importance of properly managing cyber risk. It needs to be emphasised that this is not a risk that is isolated to the IT department. Cyber risk affects almost every part of the business and needs to be managed as an enterprise risk. Essential actions to be taken to reduce the likelihood of a loss include:
The organisation will then be more prepared when a breach does incur (yes, the fact is that it is still very likely to incur) and the impact will be less severe.
Even when a risk is well managed there may still be a residual risk that is greater than the risk appetite and it is that proportion of that can be transferred by means of insurance coverage. Due to the nature of the cyber risk, some elements may be covered under other insurance policies such and D&O (Directors & Officer’s) Liability and General Liability insurance.
Before taking up cyber risk insurance it is imperative that the insureds understand, by having detailed discussions with their broker, of what coverage they need, what coverage is being offered and what risks they will need to self-insure against even after they purchase coverage.
To prepare your organisation and ensure that your cyber risk is properly managed we provide Essential Cyber Risk Training for Non-IT Senior Managers. Contact us to find out more:
RML House
12 Dunster Court
Borehamwood
Hertfordshire
WD6 1LF
Office +44 (0)208 2070 452
Help Line +44 (0)7775 900 333
info@risk-management-london.com
In a recent research report from the Information Security Forum “Threat Horizon 2018: Lost in a maze of uncertainty”, one of the top threats for organisations for 2018 is lack of availability of cyber risk insurance. The report predicts that large data breaches will drive many insurers out of the cyber insurance market and that will disrupt this method for organisations to transfer cyber risk. A reduced capacity in the insurance market will normally translate into difficulties in getting cover, high premiums as well as extensive policy exclusions.
Enterprise Risk Management Adds Value
This brings us right back to the importance of properly managing cyber risk. It needs to be emphasised that this is not a risk that is isolated to the IT department. Cyber risk affects almost every part of the business and needs to be managed as an enterprise risk. Essential actions to be taken to reduce the likelihood of a loss include:
- Increased awareness and monitoring of threats;
- training rolled out to senior management and employees;
- having a cyber risk policy in place;
- reporting of breaches and failed attempts.
The organisation will then be more prepared when a breach does incur (yes, the fact is that it is still very likely to incur) and the impact will be less severe.
Cyber Risk Cover Within Other Insurance Policies
Even when a risk is well managed there may still be a residual risk that is greater than the risk appetite and it is that proportion of that can be transferred by means of insurance coverage. Due to the nature of the cyber risk, some elements may be covered under other insurance policies such and D&O (Directors & Officer’s) Liability and General Liability insurance.
Before taking up cyber risk insurance it is imperative that the insureds understand, by having detailed discussions with their broker, of what coverage they need, what coverage is being offered and what risks they will need to self-insure against even after they purchase coverage.
Cyber Risk Essential Training For Non-IT Senior Managers
To prepare your organisation and ensure that your cyber risk is properly managed we provide Essential Cyber Risk Training for Non-IT Senior Managers. Contact us to find out more:
Risk Management London
RML House
12 Dunster Court
Borehamwood
Hertfordshire
WD6 1LF
Office +44 (0)208 2070 452
Help Line +44 (0)7775 900 333
info@risk-management-london.com